Council Urges Stockton City Manager to File for Municipal Bankruptcy
by Joel R. Glucksman on June 14, 2012
Stockton, California, may join the short list of cities that have filed for municipal bankruptcy protection amid growing economic strain.
In a 6 to 1 vote, the Stockton City Council will permit City Manager Bob Deis to file for Chapter 9 protection under federal bankruptcy law if state-required mediation discussions with creditors do not produce a financial alternative, according to Bloomberg News. This could happen as early as June 26 if the city does not win concessions from creditors, including Wells Fargo and the California Employees’ Retirement System, the news source adds. Talks with creditors will end on June 25.
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